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March 1, 2011

Providers: Be Aware of Key Hospice Risk Areas

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By: Andrew B. Wachler, Esq. and Jennifer Colagiovanni, Esq.

The Patient Protection and Affordable Care Act (PPACA) of 2010. Under the PPACA, the Medicare hospice benefit underwent changes related to both documentation and billing requirements. It is important for providers to recognize these changes and adjust their procedures accordingly. Failure to comply with these new requirements may leave providers vulnerable to claim denials and overpayment recoupment in a future RAC or other Medicare audit.

Hospice Certification

In order for a patient to receive hospice care, a physician must certify that the patient is suffering from a terminal illness and that the individual's prognosis is for a life expectancy of six months or less if that illness runs its normal course. In 2009, the Centers for Medicare & Medicaid Services (CMS) added a clinical narrative requirement to the certification process. This requirement calls for a physician to prepare a narrative outlining the clinical findings that support a life expectancy of no longer than six months in order to certify a patient for hospice.

This narrative must be reflective of the patient's individual clinical conditions and cannot contain form language or check-box information. Furthermore, the physician is required to attest that he or she wrote the narrative personally, based on examination or the patient's medical records. This additional measure is designed to ensure that the physician has diagnosed the patient's condition personally and is not just signing off on what another clinician on the nursing staff has concluded. Increased physician and patient contact seems to be the trend in hospice care recently.

Recertification

Accordingly, the PPACA also adopted several of the Medicare Payment Advisory Commission's (MedPAC) recommendations regarding recertification. Specifically, Section 3132 of the PPACA called for greater physician engagement in the recertification of hospice patients' eligibility to receive Medicare coverage for hospice services. The focus on increased physician engagement was memorialized in a Final Rule issued on Nov. 17, 2010 a directive that incorporated new legislative requirements for face-to-face encounters.

The new regulations required that a hospice physician or nurse practitioner undertake a face-to-face encounter with all hospice patients prior to the 180-day recertification - and all subsequent recertifications - to determine a patient's continued eligibility for hospice. The face-to-face encounter is not required for certification of the first or second 90-day benefit period, but must be performed for patients entering their third (60-day) benefit period, and for any and all subsequent 60-day benefit periods. While nurse practitioners may conduct the face-to-face encounter, only a physician may certify the patient's terminal illness. Thus, if a nurse practitioner conducts the encounter, he or she must certify that the clinical information was provided to the certifying physician.

The face-to-face encounter is required to take place no more than 30 days prior to the 180-day recertification or subsequent recertifications. Without a valid face-to-face encounter, Medicare will not cover the hospice stay. The face-to-face requirements took effect on Jan. 1, and all providers now need to adopt protocols to ensure that these encounters are taking place with the appropriate personnel and in the time frames required - or risk potential claim denials.

Once a patient has been certified properly, level of care is another important consideration. Hospice care is provided in four different levels, including routine home care, general inpatient, continuous home care and inpatient respite care. Each level has specific criteria used to determine whether it is the appropriate level of care for the patient at issue, and each level has its own billing rate. Providers need to ensure that they are meeting all the requirements for the level of care billed in order to avoid any possible issues when or if their practice becomes the subject of a RAC or Medicare audit.

The audit and compliance environment continues to change at a rapid rate as new documentation and coverage requirements are implemented. Based on our experience, providers are facing key audit risk areas and claim denials related to six-month prognosis, level of care, continuous care, inpatient hospital admissions, hospice/nursing facility benefit and technical denials for certifications. The best defense for a RAC or Medicare audit is to have a comprehensive compliance plan in place that mitigates these and other potential audit risk areas. This is especially true in the hospice arena, where CMS recently has been implementing provisions of the PPACA that directly affect hospice providers. While there is a no guarantee that a provider with a strong compliance program will not find his or her practice in the crosshairs of a Medicare auditor, it is one of the best ways to prepare for the situation proactively.

Andrew B. Wachler is the principal of Wachler & Associates, P.C. He graduated Cum Laude from the University of Michigan in 1974 and was the recipient of the William J. Branstom Award. He graduated Cum Laude from Wayne State University Law School in 1978. Mr. Wachler has been practicing healthcare and business law for over 25 years and has been defending Medicare and other third party payor audits since 1980. Mr. Wachler counsels healthcare providers and organizations nationwide in a variety of legal matters. He writes and speaks nationally to professional organizations and other entities on a variety of healthcare legal topics.

Jennifer Colagiovanni is an attorney at Wachler & Associates, P.C. Ms. Colagiovanni graduated with Distinction from the University of Michigan and Cum Laude from Wayne State University Law School. Upon graduation, Ms. Colagiovanni was nominated to the Order of the Coif. Ms. Colagiovanni devotes a substantial portion of her practice to defending Medicare and other third party payer audits on behalf of providers and suppliers. She is a member of the State Bar of Michigan Health Care Law Section.